Michael Chase – Page 17 – Portland Real Estate Up Close

October 3, 2016December 30, 2020

I find that lots of Buyers are a bit confused about Earnest Money and what its purpose is, how they might be at risk for losing it, etc. It is basically to compensate the Seller for taking their home off the market in the event you violate the terms of your Sale Agreement, but there are nuances to it in addition to that. Here are a few pieces of info & pointers in that regard:

A Few Notes About Earnest Money:

Earnest Money is a deposit you make at the time you make your Offer. This is to show that you are “earnest” or serious about your Offer, and to compensate the Seller for removing their property from the market (while you perform your inspections & due diligence) should you violate the terms of the Contract/Offer/Sale Agreement.
Talk to your Realtor about how much an Earnest Money Check should be…. It varies from situation to situation. The ultimate choice, however, is yours. A substantial amount of Earnest Money can demonstrate to the Seller that you are serious about the purchase, and shows a certain amount of stability, though this is not necessary or even advisable in all circumstances.
Earnest Money goes toward your closing costs & other transactional terms. It is held usually by Escrow as your neutral 3rd party and applied to the bottom line of your transaction, generally speaking. By virtue of its definition as Earnest Money, its NOT an additional fee.
There are several ways for a Buyer to cancel a sale and receive their Earnest Money back (during specified & agreed-upon timelines & specific acceptable reasons that are all outlined in the Offer itself). This action is not to be taken lightly, and/but, there are definitely provisions for it.
The Earnest Money check (a photocopy of it) accompanies the Approval Letter, a Cover Letter your Buyer’s Agent will create, and the Offer when your Realtor submits it to the Seller’s Agent (at least… that’s how I always do it). In the event you are unable to physically hand your Realtor a check prior to when you want to get your Offer in to the Seller, you may have the option of using a Promissory Note redeemable/sent to Escrow in check form within a specified number of days following mutual acceptance of your Offer. ***I advise my clients that a check is always preferable. A photocopy of it going along with your Offer makes a statement to the Seller that you are serious. This is especially true in a competitive situation. Again, though, each situation is different. Discuss YOUR best options with your Realtor.
Carefully study the Sale Agreement (Offer) wording to make sure you understand how and under what circumstances you are allowed to have your Earnest Money returned, and under what circumstances you are not. Basically, staying within outlined timelines and giving notice in writing within those timelines assures your Earnest Money is protected. It is important that, with your Realtor’s assistance and advice, you stay on top of timelines as outlined in the Sale Agreement. ***Bring ANY questions you may have to your Realtor’s attention.

I hope this information was helpful!

Very Best,

Linda

October 3, 2016December 30, 2020

Tips & Tidbits

Linda Rossi – October 3, 2016

Seasonal Changes –

Sellers~The market has been unusually activated since about January of this year. In the summer (starting approx July 4th weekend) things typically slow down just a teensy bit as people leave for vacation and many have found the homes they were looking for prior to the school-year-start in September (ie the pool of Buyers lessens some). Sellers who put their homes on the market now will still find plenty of interest as you can ascertain from our Market Activity Reports, and/but may be disappointed if they do not have a bidding war as they’ve been hearing about for awhile now. I’m not saying the market is not still good for selling, (and, there ARE ways to encourage multiple Offers at any time of year) …just be prepared for the slight change in atmosphere, which sometimes translates to not quite as much leverage when you’re the Seller. ***That said, it is all case-by-case. Why is the Buyer buying? Do they need to be settled before the school year starts? Have they lost out on other deals due to competitive bidding? You may or may not be able to find out, but if you DO know the answers to some of these questions, it can help you respond to your highest advantage. Trust your Realtor, or if you don’t have one, give me or one of us a call and we’ll be happy to help you through the changing landscape.

Buyers~A Buyer’s perspective is a little different. If you’ve been out looking and fighting for houses and losing, now may be your moment. As I mentioned above, the market has been hyper-active for a while now. As we move toward Fall, a couple of factors are in your favor. The first is that the pool of Buyers is lessening a bit for the reasons I mentioned above. This means you may not be in a competitive situation, or it may be with fewer Buyers if you are. Use the lessons you’ve learned already through trial and error. Make your Offer as strong as you are comfortable with. Talk to your Realtor (or to myself or one of us if you do not have a Realtor) and we can walk you through some ways to do that. Talk to your lender once again and revisit your strategy. If you are unsure of how your Offer price would impact you as far as your monthly payment is concerned, I always suggest having 3 dollar-amount scenarios drawn up. I find that most Buyers are surprised at how little their monthly payment is affected by making what seems to them to be a big jump in their Offer price. Bottom line: you need to be comfortable with your Offer. AND, you may be surprised at what the possibilities are for you, and sometimes this can make a difference in getting the home you really want in a still-competitive market.

Other Factors~Appraisals are really becoming more of an issue than even a month or so ago when Dianne mentioned them in a post herein. I advise my Buyer clients to talk to their lender about expediting their Appraisal in nearly every case. This costs money, so you need to assess what you can and are willing to do, but it is often a hundred or two dollars, and can mean the difference between Closing on time or not. ***That said, I have heard multitudes of horror stories in the last few weeks about Appraisals taking **weeks or months** longer unless someone pays an exorbitant amount sometimes in the thousands of dollars. I don’t mean to scare anyone. I just averted a near-disaster in this regard, and having a Realtor and lender with their eyes on the ball in this market is imperative, but this is apparently happening if there are any variables at all in a transaction that will limit the appropriate Appraisers who might be available/qualified etc. Sometimes the type of loan (VA, FHA, USDA) can limit the pool of Appraisers (I’m told) as can location of the property (is it outside of the metro area?).

The reasons for this mess are varied, but it apparently boils down to supply and demand, coupled with the newer regulations on mortgage companies. No longer can a mortgage company call an Appraiser they happen to know is familiar with a particular neighborhood or area of town. For everyone’s protection (to prevent collusion/nefarious behaviour/trying to get a particular value out of the Appraiser) mortgage companies now have to put the order in to an “Appraisal Scheduling” company. That company has a stable of Appraisers, and it is all handled mechanically. There is apparently a dearth of Appraisers due to more stringent requirements for becoming an Appraiser (I’m told), and therefore the stacks on Appraisers desks are getting higher and their time and availability to run out to more rural areas or even here in town is more scarce.

October 3, 2016March 20, 2022

Giving

I thought it might be a good idea to take a look at things we might be wanting to include on our to-do lists & consider taking care of before the end of the year. Namely…Giving! Its fall and we're heading into the Celebrating & Giving time of year pretty soon. Many want to think ahead about tax time as well. If you’re going to give anyway…. this is definitely the time to do it!

Here are some worthy ideas for your consideration:

Here’s a great resource site to help you evaluate the most worthy recipients of your donations based on their research: The Portland “Give Guide”
If art is important to you, consider donating to the Regional Arts Council.
Speaking of giving, I know from my days in my son's school's Booster Club, that every community has needy families. Some of your kids’ friends may very well have parents who’ve lost a job, or are in some sort of upheaval and wondering how they’re going to be able to pay their bills let alone create a semi normal-feeling holiday for their household . Your favorite local school probably has names of families in need. Give a call to the school of your choice and think about donating a holiday roast or turkey, or just dropping off a few gifts. The school counselor usually knows just what to do with this kind of generosity, and you’ll know you really made a difference for some needy family in your own neighborhood.
If animals are near and dear to your heart, there are lots of options for donating. The Oregon Humane Society is an obvious choice, and/but some smaller outfits that take up the slack and don’t have quite the visibility of the OHS would be heart-warmed to receive your donation. One that is recommended to me by someone in the know is the Family Dogs New Life Shelter. It is a no-kill shelter that does excellent work.

There are so many great choices, I thought I’d highlight just a few and give you some links to resources that offer many options. Enjoy your holidays, and the Joys that come with the season!

October 3, 2016December 30, 2020

Blast from the past

Linda Rossi – October 3, 2016

I think this snapshot in time was in California. I bought my first house in around 1987-ish (?) for $48,000 in Portland…

June 15, 2016December 22, 2020

June Market Action Report

Linda Rossi – June 15, 2016

June 2016:

According to the RMLS Market Action Report for the Portland Metro Area, June, 2016:

There were 4,501 New Listings in June which was up 8.6% from May, and up 5.2% from May of 2015.
At 3,158, June Closed Sales were up 9% from May’s 2,896, and down 4.4% from June of 2015’s 3,302.
June Pending Sales (Accepted Offers), at 3,390 down 4.9% from May’s 3,563, and were also 6% lower than June of 2015’s 3,605.
The Average Sale Price in June of $412,000 was up $9,500 over May’s $402,500, and also up around $42,500 from June of 2015’s $369,500.

May 21, 2016December 22, 2020

May Market Action Report

Linda Rossi – May 21, 2016

5/21/16

April is seeing, generally, Price and New Listings increases over March, and a decrease in overall productive activity (Closed & Pending Sales) compared to April of last year.

Here are the latest/April numbers for the entire Portland area:

According to the RMLS Market Action Report for the Portland Metro Area, April, 2016:

There were 4,082 New Listings in April which was up 19.7% from March’s (3,409), and up 3.4% from April of 2015 (3,949).
At 2,611, April Closed Sales were up 1.8% from March’s 2,565, and down 4.5% from April of 2015’s 2,734.
April Pending Sales (Accepted Offers), at 3,432 were up 11.6% from March’s 3,076, but were 5% lower than April of 2015’s 3,613.